Narrative
Full Description
Project narrative
On December 31, 2019, Bank of China Limited and the Government of Benin signed an EUR 167,370,658.24 ($187,393.214.30) buyer’s credit loan agreement for the Ouidah Marina Project. The loan, which is captured via Record ID#91636, carries the following borrowing terms: a 13-year maturity, a 2-year grace period, and a 3.9% interest rate. It is backed by a buyer’s credit insurance policy from Sinosure. Bank of China and ICBC also issued an EUR 90 million syndicated buyer’s credit facility, which is captured via Record ID#91635, to an unknown borrowing institution (that was backed by a sovereign guarantee and a Sinosure buyer’s credit insurance policy). The borrowing institutions were expected to use the proceeds of the two loans to partially finance an EUR 449.3 million commercial contract between the Government of Benin and Yunnan Construction and Investment Group (YCIH), which was signed on May 21, 2018 and approved by Benin’s Council of Ministers on July 3, 2019. The purpose of the project is to develop a marina and hotel and tourism complex at the Ouidah Port. The project involves the construction of hotel and lodges, an esplanade with restaurants, bars and entertainment sites, 4 km of submerged dikes in the Avlékété district in Ouidah (to disperse the waves and make the ocean safer for swimming); an arena for religious and culture events, two car parks with over 350 spaces, a floating promenade in a lagoon, remembrance and meditation gardens, a tourism office, and a historical reconstruction of a slave ship. The project site is located in the town of Djègbadji within the commune of Ouidah. YCIH is the contractor responsible for implementation. The project site was turned over to YCIH on April 15, 2021. A formal groundbreaking ceremony took place on July 1, 2021. Then, during the first quarter of 2022, initial earthworks and pile foundation work was undertaken. The President of Benin conducted an on-site project inspection on May 25, 2023. Then, on December 12, 2023, Benin's Minister of Tourism, Culture and Arts of Benin conducted an on-site project inspection. The Chinese Ambassador to Benin conducted an on-site project inspection in February 2024.
Staff comments
1. The World Bank’s Debtor Reporting System (DRS) identifies the commitment year as 2019. The Government of Benin’s Debt Management Agency (Caisse Autonome d'Amortissement or CAA) identifies the commitment year as 2020. A confidential (official) source informed AidData that the loan was contracted in December 2019. 2. Some sources suggest that the commercial contract was signed on June 27, 2018 rather than May 21, 2018. Other sources suggest that the commercial contract was eventually resized and amended to EUR 185 million. These issues merit further investigation. 3. The Chinese project title is 贝宁维达海滨区项目 or 维达海滨区项目 or 维达旅游项目 or 贝宁维达海滨项目 or 贝宁维达海滨项目. The French project title is travaux de construction du complexe touristique de la Marina et des infrastructures auxiliaires à Djègbadji dans la commune de Ouidah or Construction d’un complexe touristique "Marina" près de la Porte du non-retour à Djègbadji - Ouidah or Projet Marina – Porte du non-retour (Ouidah) or le projet Marina de Ouidah. 4. As of April 2020, neither then EUR 167.3 million Bank of China loan nor the EUR 90 million syndicated loan from Bank of China and ICBC were included in the Chinese Loans to Africa Database developed by SAIS-CARI and maintained by the Global Development Policy Center at Boston University. 5. One source (a law firm called Mayer Brown) claims that the EUR 167,370,000 syndicated loan was supported by multiple Chinese banks. This issue merits further investigation. 6. Some sources suggest that the interest rate was based on a floating market interest rate (most likely EURIBOR). This issue warrants further investigation.